Plan assets: Difference between revisions
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The second limb of this is rather tendentious. What has the [[ | The second limb of this is rather tendentious. What has the [[Internal Revenue Code]] got to do with retirement plans? Well, if an {{tag|ERISA}} plan transacts with any party having a conflict of interest — its own manager, fiduciaries and so on — this is a [[prohibited transaction]] which is subject to a 15% tax. This is the kind of thing that freaks people out about ERISA. | ||
Still, there’s a less tendentious way of getting there. Section 4795 of the [[Internal Revenue Code]] imposes a tax, but only on “prohibited transactions”, which are only with [[disqualified person]]s. [[Disqualified person]]s are defined as “[[parties in interest]]” to an ERISA [[employee benefit plan]]. So, if you recraft the representation so, you achieve the same effect: | Still, there’s a less tendentious way of getting there. Section 4795 of the [[Internal Revenue Code]] imposes a tax, but only on “prohibited transactions”, which are only with [[disqualified person]]s. [[Disqualified person]]s are defined as “[[parties in interest]]” to an ERISA [[employee benefit plan]]. So, if you recraft the representation so, you achieve the same effect: | ||